10 Cheap Wide-Moat Stocks for 2025
Undervalued high-quality names from the Morningstar Wide Moat Focus Index are attractive stocks to buy for long-term investors.
The Morningstar Wide Moat Focus Index tracks companies that earn Morningstar Economic Moat Ratings of wide and whose stocks are trading at the lowest current market prices relative to our fair value estimates.
Wide-moat companies carry sound balance sheets and significant competitive advantages—two desirable qualities in the face of today’s economic uncertainty.
The constituents of the Morningstar Wide Moat Focus Index are a fertile hunting ground for long-term investors looking for high-quality stocks to buy that are trading at cheap prices.
10 Cheap Wide-Moat Stocks for 2025
These were 10 of the most undervalued wide-moat stocks in the Morningstar Wide Moat Focus Index as of Sept. 26, 2025.
- Constellation Brands STZ
- Adobe ADBE
- Nike NKE
- Bristol-Myers Squibb BMY
- Kenvue KVUE
- Brown-Forman BF.B
- Danaher DHR
- MarketAxess Holdings MKTX
- Merck MRK
- TransUnion TRU
The most undervalued wide-moat stock on the list, Constellation Brands, was trading 41% below our fair value estimate as of Sept. 26, while the last company on the list, TransUnion, was trading 29% below our fair value estimate. We think all 10 of these names are high-quality stock ideas for long-term investors to consider.
To keep the index focused on the least-expensive high-quality stocks, Morningstar reconstitutes it regularly. The index consists of two subportfolios containing 40 stocks each, many of which are overlapping positions. The subportfolios are reconstituted semiannually in alternating quarters on a “staggered” schedule.
Morningstar reevaluates the index’s holdings and adds and removes stocks based on a preset methodology. Because stocks are equally weighted within each subportfolio, the reconstitution process also involves rightsizing positions.
After the most recent reconstitution, half the portfolio added 17 stocks and eliminated 17 stocks.
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17 Undervalued Stocks Added to the Morningstar Wide Moat Focus Index
These cheap stocks were added to the reconstituted subportfolio of the Morningstar Wide Moat Focus Index on Sept. 25.
Most of the 17 cheap wide-moat stocks added to the index this quarter hail from one of three sectors that, in aggregate, look fairly valued to overvalued today: technology, consumer defensive, and industrials. There are obviously undervalued stocks to be found in even overpriced sectors.
17 Stocks Removed From the Morningstar Wide Moat Focus Index
These stocks were removed from the reconstituted subportfolio of the Morningstar Wide Moat Focus Index on Sept. 25. Stocks can be removed from the index for a few different reasons: if we downgrade their economic moat ratings, if their market capitalizations fall beneath a certain level, or if their price/fair value ratios rise significantly.
Most of the stocks removed from the subportfolio during the latest reconstitution were pushed out by stocks that were trading at more attractive price/fair value ratios at the time of reconstitution. However, Campbell’s CPB was booted from the reconstituted portfolio after its market capitalization fell below the index’s requirements. And International Flavors & Fragrances IFF and Pfizer PFE were removed from the index because their Morningstar Economic Moat Ratings were downgraded to narrow from wide.
The stocks that were removed shouldn’t always be considered stocks to sell, though—especially when the removed stocks are still trading in what we’d consider a buying range. They’re just not as undervalued as the stocks added to the index at the time of the reconstitution.
What Are Wide-Moat Stocks?
Morningstar thinks that companies with wide economic moats have significant advantages that allow them to successfully fend off competitors for decades. Companies can carve out their economic moats in a variety of different ways: by having high switching costs, through strong brand identities, or by possessing economies of scale, to name just a few.
Over time, we’ve found that the strategy of investing in wide-moat stocks trading at a discount to their fair values has been an effective approach to stock investing.
The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.
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